Group says economic impact more than $187 million
— Two gas companies are dropping all leases with residents in northern Wayne County.
"They are killing economic activity in Wayne County," said Peter Wynne, a member of the Northern Wayne Property Owners Alliance (NWPOA) executive board.
"They," he said, is the Delaware River Basin Commission, the group which has regulatory authority over proposed Marcellus shale gas drilling in Wayne County.
To date, the DRBC has not allowed any drilling in the county and Wynne said there is no reason to think it will happen any time soon.
"This is because of the DRBC," said Wynne about the latest blow to the NWPOA.
Wynne said Hess Corporation and Newfield Exploration Company, both of Houston, Texas, sent out letters last week informing the property owners of the decision.
He said it will impact some 100,000 acres of land in northern Wayne County.
Wynne put the economic impact of the decision at $187 million — money he said will be lost to the county.
He said the economic blow is especially troubling since the group negotiated what Wynne calls a model gas lease.
"We spent more than $500,000 to negotiate the finest gas lease in the business," said Wynne, adding the lease is now used as a model for leases around the country.
The group, which represents a large portion of property owners in northern Wayne County, had a tiered lease with the company.
In the lease, property owners in Zone 1 received $1,500 per acre and Zone 2 owners received $1,100 per acre in up-front money from the gas company.
Had exploration moved forward, property owners would receive $1,500 and $1,900 respectively per acre.
But, said Wynne, that is not going to happen because of the decision made by the companies last week.
"It is because of continued regulatory uncertainty," said Wynne. "They just can't plan ahead."
Wynne said gas company representatives told the property owners because of the lack of action they see with the DRBC, the time came to simply pull out of the county.
"People are not happy," said Wynne, who added that the NWPOA executive board met Sunday night to consider its options.
"We are, as an organization, continuing our exploration of a lawsuit," said Wynne.
Though Wynne said the group recognizes DRBC doesn't have any money, there is a bigger picture to be pursued.
"We're in discussions with a couple of different law firms," said Wynne. "Our goal is to force them to lift the moratorium."
Wynne said the group firmly believes DRBC officials have no intention of making a decision any time soon.
He did say they will continue to pursue other leases, but the hopes are not high.
"Nobody is going to come near us," said Wynne.
The other side
"I hope they stay out," said Jackie Desau, a local resident who is against shale gas development in Wayne County.
Desau said she fears it could be a ploy on the part of the gas companies.
"They like to play psychological games," said Desau.
She said sometimes gas companies will say one thing and then might turn around and do something different. That, she said, could happen if the companies decide to come back and do more leases.
"If they are staying out, I will be happy," said Desau.
She also emphasized she wants to raise "awareness" about gas drilling but she doesn't consider herself a protestor.
"I did an awareness walk, not a protest walk," said Desau.
Desau also said she hopes the payments from the gas companies were made to the property owners in Wayne County.
"I don't want the landowners getting screwed," she said. "I may be against what they are doing, but they are human beings."
According to the letter written by Newfield Appalachia PA, the company handling the leases, payments have been made to the property owners.
"Please be aware that all payments per the terms of the lease have been paid and no future payments are due," states the letter, signed by Scott A. Cavett of the company.
It further stated the company will file a record of release of lease with the office of the county clerk.